Financial Restructuring

Over the past decade, enormous economic change has been taking place in the aerospace and defense industry, the kind of change that creates complex challenges. The capital- intensive nature and lengthy research and development cycles of our industry, plus the fact that return on investment must be calculated over a very long period of time, create a situation that no industry could sustain without confronting complicated choices.

At First Equity, we help clients find their way through these difficult times. Combining our financial, aerospace and restructuring expertise, we can quickly respond to the needs of clients in financially distressed situations. Working closely with each unique case - regardless of complexity - we assist clients in finding solutions, be it through Chapter 11 planning and support, asset divestitures, or assistance with debt and equity financing.

We believe restructuring should be a fundamental, positive strategy for profit, growth and lasting value, for only by embracing change can we prepare for the future.

Mooney Aircraft Corporation

Mooney Aircraft Corporation is a manufacturer of aircraft recognized as performance leaders in the single engine market. Facing difficult market conditions, Mooney filed for Chapter 11 bankruptcy protection in late July 2001. The company's creditors hired First Equity in mid-September to quickly assess the marketable strengths of Mooney, prepare the company for sale, and find a worthwhile acquirer. Within two months, First Equity's successful marketing had generated serious interest from over 120 parties and resulted in nearly a dozen formal acquisition offers.

While a number of private investor groups and restructuring experts attempted to purchase the company for low valuations, First Equity targeted a handful of strategic acquirers, particularly development stage aircraft manufacturers who valued synergistic opportunities as well as Mooney's excellent brand equity and reputation. After an extensive period of negotiation, the secured debt position in Mooney was sold to Advanced Aerodynamics & Structures, Inc. (AASI), which subsequently purchased Mooney's assets with the approval of the bankruptcy court and Mooney's numerous creditors.

AASI, designer and manufacturer of the Jetcruiser single-engine turboprop, intends to restart production of Mooney aircraft and rename AASI as Mooney Aerospace Group, Ltd.